I would usually be dancing on stage if we were in person. Hi, everyone. I am Natasha Mascarenhas. I am a reporter here at TechCrunch. And today I'm joined by actually one of the first venture capitalists I met when I started covering tech, the wonderful Bucky, more of Kleiner Perkins, Bucky, so great to have you.
It's Asha. Thanks for having me. Nice to meet you everyone in the crowd.
Yeah, for people that don't know more, is obviously a partner at kp. He sits on the boards of companies such as netlify, materialized, upstream and stack bit. And he focuses a lot of his energy on developer facing software and infrastructure. So if you're in those sections, sectors, definitely pay attention. But even if you're not, I think this talk will be something you want to take notes from, because we are talking about one of the topics I think doesn't get enough press. And it's about what to think about before you start raising your series. A. So Bucky, I believe, you're going to be giving us some tips, we definitely want the audience to ask some selfish questions, throw Bucky on the hot seat, make my life easier. And definitely just ask any questions you have about how to figure out when to raise and how to raise. But I think with no further ado, I will pass to Bucky to kind of start us off on the kind of top things to think about and if I understand correctly, what a founder needs to do to get a free term sheet from Kleiner.
We'll see what's next. So So yeah, I think it's best to keep this interactive, as Natasha suggested, and I welcome all of your questions and look forward to doing my best to answer them. But I'm gonna try and keep this simple and scope it to four things that I think are questions that one should be asking themselves as a founder before you go and raise a series A. And I think if you if you ask these four questions of yourself, and you can arrive at clear answers, I do believe they will materially impact your ability to be successful in fundraising at that stage. And so let's dive in. So the first thing I want to talk about is why nem? I think this is a term you hear thrown around pretty loosely by people like me when talking about the prospects of a given startup or fundraising in general. But I do believe it's a very important one, albeit a commonly used one. And really the way I think about why now here is, it's an opportunity for you as a founder to convey a unique insight and understanding of your market opportunity, the history of the space that you're in why companies have succeeded or failed in that space, historically speaking, what are the known challenges? From a go to market perspective? What, what headwinds Will you be up against at a macro level, etc. These are all things that I think people like me get really excited about when hearing unique insight from founders on, because it suggests that they've really studied their market opportunity, and they understand it. And that is obviously a really important aspect of success in building a company. Right? So we think about that a lot. And so that's one part of why now, the other part of the other part of the why now question for me is, I do think it also ends up being this kind of segue into the unique insight that your business is built upon. Every company has one. And I think it's just important that you're very intentional about being aware of what that is for you. And you know, one example that I like to cite have a really interesting kind of wine out proposition as a company that many of you have heard of, but now it's become quite the household name called figma. So figma, for those of you haven't heard of it, is bringing design into the browser. So they make it collaborative, they make it very easy to get started. And what they figured out how to do is actually bring in non designers into the design process, and make that process much more interactive one that the entire company can get involved in. And so coming back to this question of why now and famous case, what they were telling the market when they were getting started was and I think this is in fact true and very easy to prove with data is that designers were becoming more in demand than ever before. Right, as more and more companies kind of embark on this so called journey of digital transformation, that's synonymous with a need to produce digital products, right digitize the experiences their customers have with their products to build software to realize efficiencies in their business. And to build all those digital products, one needs to design them. And so it just felt like kind of the age of design was applause and large companies were embracing building out large UX design teams for the first time. whereas previously, those large teams have been limited to largely internet and software companies. So the so called everyone as a software company starts to kind of ring true here in the context of design. And figma really understood that and told a clear story around it. And the way that they're actually able to prove that that was quite interesting was they started to research inside of large companies, the ratio engineer to designer and what the data suggested was that that ratio of designers to engineering was going up, which means again, the market opportunity is getting deeper and broader at the same time. So that was part of the why now that I think is a really a really clear example of something that gets an investor pretty fired up but series A and famous case and obviously they've gone on to have a lot of success. And I think that original hypothesis of why now has proven true.
I think you know, something that comes to mind too, if I can interject here is like, let's say, I mean, one idea that's come up recently is there are so many clubhouse competitors, there are so many virtual HQ platforms, top to Top of Mind ones at least. Is that a good? Why now? I mean, the answer being there's so much there's so many other competitors out there. So obviously, some of the brightest minds are doing it or to you is that not necessarily a strong line now,
I think what's more interesting is not so much that there is an existence of a competitive landscape that's growing. And those companies are being built by smart people, but a clear sense of why smart people are flocking to that opportunity. So again, I think that kind of comes back to more of the foundational conditions in the space that you're in and what's happening at the moment that's driving more interest driving more opportunity. So rather than rather than trying to identify competition as a why now I do think it's more of a kind of a first principles approach to asking why there's competition suddenly arising in a space that typically gets you to the right answer.
Great, great. Talk to me a little bit about kind of the metrics you're looking at, or a company should be thinking about before they enter kind of that pitch room, or pitch. So
I think this is a good segue into the next topic I was going to cover here, which is another way of thinking about metrics. And first of all, I think it's important to take a step back and recognize that metrics are not just revenue, right? There's there's so many different flavors of metrics that can really suggest that your company is starting to inflect in some form of progress. And that was the question that I was going to encourage you to ask next, which is, where inside of my company, can I show signs of inflection. And again, not just revenue, but things like user growth, or even engagement have a small and narrow population of users, maybe some kind of community that's growing around your product and the movement that you're driving social media buzz that can associate with that, maybe you're generating new IP at an accelerating clip, that's also very interesting to certain types of investors. And most importantly, also hiring progress, especially at the early stages, one of the things that I think you'll notice a lot of investors get excited about is just progress in building a high quality team that shored up the gaps in the founding team and suggest that the company kind of has the right pieces around the table, the right people around the table to scale to the next level. And so we think about that a lot. And frankly, all of the things that I mentioned, are often lagging indicators of some early form of product market fit, if not clear indicators of it. And so we think about that a lot. And again, I would encourage you to take a step back and not not hold yourself just thinking about revenue here. But anywhere in the company where you feel like your rate of progress, steepening. When you craft that narrative about how you go and raise a series A, I would encourage you to emphasize that because it is exactly what investors get really excited about is a clear understanding of what's inflecting. And then what you've done to actually drive that inflection, and how you're going to go out about scaling that. And an example that I'll come back to here in our portfolio is a company that intosh already mentioned that I work with called net worth. So we lead the Series B of netlify, back in 2018. And rather than revenue scaling at the time, while there was revenue, what we got really excited about was actually inbound user signups. So there were developers coming in and showing up at this accelerating clip and building websites for the first time. And what it suggested was that while most of those users were not paying yet, because of how early their use cases are, that there were this movement happening, and netlify was really at the forefront of it. So I think often that that allows us to take a very different view of some of these investments, when we're not as focused on the things that maybe growth investors are such as revenue, such as more kind of like business metrics, we got really excited about that netlify use case. And I think what we found is that it was indeed a lagging indicator of of accelerated revenue generation, and that company has gone on to do really well, and is continues to be kind of on the edge of this new new web development, architecture that we get really excited about a kp. So again, ask yourself where your company is beginning to inflect and do not hold yourself to revenue only many great series A's get done in companies who have absolutely zero revenue.
And even as a small follow up there, I think, for example, the example you gave of your portfolio company, I think to some startups, that's the best case scenario, do we have something that we can have tell our stories such as you users kind of naturally gravitating towards us? At least, you know, from your position at Kp, do you think that, you know, you're only looking for companies that really have found product market fit through some metric? Or do you think you know, you can raise a series A without really getting that fit?
The unfortunate answer is that it depends. And that of course, I would say most series A's that we that we see, both getting done by ourselves at Kleiner Perkins as well as our peers tend to have some very clear indication of product market fit again, that product market fit indicators, not just revenue, it can be many other things, but there is some fear there. And so taking a step back, I guess more interesting question is to be like where you see series A's getting funded, where there isn't necessarily through product market fit. I would say what you typically see there is a company that's generating some really unique intellectual property, yet software technology or you know, something unique at the hardware layer, pairing that with an eventually very large market opportunity to suggest should the technology work should they mitigate the technical risk, that there will there will be near uncapped demand in the space that they're operating in? That's another flavor of series. You will see both successfully here and there. But I think those are a bit more of exceptions rather than the rule. And so I'm hesitant to anchor on those in this conversation, but they do exist.
Sure of you bringing in one audience question here before we kind of move to the next topic, but it's someone's kind of asking anonymously, if the pandemic has made some metrics matter less to you as an investor, then, you know, pre pandemic of anything has anything kind of been fading as an opportunity or as something that you think is notable when it comes to raising institutional capital?
I think there's, there's sort of two ways to answer that question. The first way is like, how do we, how do we evaluate companies who really struggled throughout the year 2020, when I think the initial shock of the way the world is changing from the pandemic, became apparent and felt? And my answer to that would be that I think there are a number of really high quality businesses out there both in and outside of the Kp portfolio, we have a great deal of conviction and are very bullish on who had just really difficult years in terms of scaling their business last year, right. For example, if you were anchored heavily on selling through in person trade shows and conferences, or you had a lot of exposure to the retail and hospitality industry. You had a tough year last year. And we understand very clearly why. So I think I think for us, as long as we understood where the challenges lied, and how those were going to affect the company over a timescale of say, you know, two, three years, it was much easier for us to sort of get comfortable with both how we would advise a company that we were already invested in, but also how do we think about their their growth prospects as potential new investments? But that the first part of the answer the question, the second part is really just how has the pandemic changed the way we think about investing specifically in series? A, it sounds like is what you're asking? What I would say is that, I think it's given us a great deal of appreciation for just how absolutely advantaged software and internet businesses are, in this world that we live in today, right, we saw many companies actually accelerate. Again, some of that was because of remote work becoming more pervasive, and that being a very advantageous condition for a company, some of that was actually that their peers were selling. So they're gonna pop down kind of direct format, and they have very scalable inbound, more asset light go to market models that just thrive relative to their competition. But I think what it's taught us is that this notion of bottoms up sales is a really powerful concept that I think is actually gaining quite a bit of steam, even in the enterprise that has traditionally only been receptive to top down sales. And I think for us, we we've definitely started to lean harder into appreciating the efficiency of go to market motions in specifically software businesses more than we ever have. And again, that's something that we scrutinize pretty heavily even going in, but I think the bar has just been raised, as we've seen some companies really, really thrive in the midst of the pandemic. So we think about that a lot.
Great. And I think you kind of alluded to an answer to another question I just got from James Brett, who said, it was kind of asking, How do I convince VCs to fund us when we do not have any significant revenue, what you've addressed, but maybe double clicking into the fact that James has kind of new tech and is having a SAS play? Are there? Is it kind of down to the founder story at that point, similar to a seed round? Or is it kind of what you were talking about earlier? Which is these other metrics that you can use to demonstrate insights? Well, I
think in the absence of product market fit, taking a step back and asking yourself, is now the right time for me to raise a series A as a company is an important question. And if you if you've come to the conclusion that it is in spite of that locker product market fit, I would come back to this question about like, how can you craft a narrative around your company that suggests there's something else that's really spiking in terms of progress? Again, it could be the rate at which you're adding team members and who those team members are, it could be the atmospheric pressure building around your market opportunity. So for example, there were a lot of companies over the past few years that were pretty heavily indexed to some of the regulatory landscape changes from a data privacy perspective that I think a lot of attention because there's some sense of inevitability about their market opportunity coming to bear over the next couple of years, but but it took some time. So I think there are ways to do it. But I would really urge the person who asked this question to be intentional about why now's the right time for the company to for his company or her company to raise a series A, particularly when product market fit remains on the come. I think there's a lot of risk that you're taking on as a founder of doing that. And so it's important to be to be wise.
Yeah, let's, let's talk a little bit more about founders. I think the biggest thing that is so you know, hot and crazy about seed rounds is you're honestly betting as an investor on the founder versus that product market fit. I mean, how do you view the bet on the individual changing when a series A when it's time for a series A let's say, the founders decided it's time and we have the metrics? How should they start thinking about telling their own story to an investor?
Yes. So I think just as important as the why now question as to why you right, so what why, why is your founding team, the right team, to go about pursuing this market opportunity and building a company that You're setting out to build, I think there's, there's a number of ways to think about that like, one could be as simple as like I just have this innate passion for this space, maybe it's a manifestation of my life's work. And so it's just has a unique amount of meaning to me as a founder relative to anyone else who could be going after the problem. Coming back to kind of life's work, it could just be like a really well aligned idea with your academic and prior work experience, you could have had a personal life experience that might have motivated you to want to go and start a company. So for example, I heard a founder pitch pitch, the partnership very recently, was very interested in digital therapeutics for autism, and how to have a family member who had suffered from autism before, there's some very deep personal meaning connected with his desire to start that company that got us very excited. And then sometimes, and last but not least, you're the customer of this company that you're building. And I think what that conveys is that you're going to have an unfair advantage when it comes to having empathy for who your customer is. And that's gonna, that's gonna help you short circuit a lot of unique insight that you would otherwise need to build up over time to serve that customer well. So that's definitely a form factor that we get excited about. But just to kind of keep going with with these questions that I would suggest asking, I think you hit on a great one here to talk about, which is why you this is a question we asked a lot. And, you know, sometimes it can be as simple as we believe we have a unique amount of grit and hustle and just desire. Yeah, but then it comes down to sort of proving that. And, again, it's we invest in founders from all different walks of life. Some are total subject matter experts in their space now that come at it from a newcomers lens and can be successful. But I do think that the less of that strong answer to the why you question I think the more we tend to anchor on why now and what suggests that your company is the beneficiary of that, why now, right? What's beginning to spike?
I think it's,
that's, you know, that focus is partly why it's such a cool time in startups right now, too. I mean, I feel like so many people just found out about their why use and why now is because of remote work and the pandemic. And, you know, it was software eating the world. And that continues to be a thesis, but it just feels like so many things that are kind of up for grabs right now. And I'm sure you guys are seeing the same thing.
Absolutely. I mean, it's a very exciting time to be building companies, because I think industries are starting to be restructured and sort of who gets to do what in each of those different value chains has therefore become up for grabs in ways that I haven't seen in decades. So I think to your point, there's, there's a lot of opportunity to reinvent oneself during this time as a founder and pursue ideas that may have felt less conventional to you. Seriously,
great. I'm going to start integrating some questions, because we have dozens already. So yeah, keep bringing them into slideshow, and I will throw them at Bucky live, you can go anonymous, but I do love saying your names. So I would do that too. First is a clear one, which is how buggy? Do you define a series A when everything is so and I quote squishy these days? You know, does the term retain any meaning? Is it just semantics? The debate hadn't every newsroom, venture capital firm and sort of office I'm sure but would love your take on it?
While this may not be the most exciting and informative answer, I do believe at this point. It's just semantics. And so, for example, there's an investment that we made last year where we were technically the second institutional investor in the company. So does that mean that we're the series A investor right, assuming that there was a seed round before that? What does that mean? Were the Series B investor? Well, in this case, that the founders decided on their cap table to call the first financing of series A because of its size, and some of the optics that they wanted to convey to the market. And so in this case, we were actually destroying the industry, I can name nine out of 10 other cases where we would have been called the series A investor in that case. And so I think this is building up to my view that really, this is semantics at this point. And ultimately, what we asked ourselves is, like worth the right amount of company, or right amount of money for the capital or for the capital raised to be, and what is the company going to do to put that to good use? And ultimately, then what becomes kind of the right way to value the company in that construct so that we, we can sort of satisfy our strategic objectives as an investor, but also give the company what it needs, which is, you know, as much capital as possible at a low at a low price. Yeah, I
think, you know, one thing that founders talk to me about, off the record always is like, we don't know how much money we need right now. And I want to know, like, as an early stage investor, do you find yourself giving advice? And I would love any advice here today to on like, how much money should you raise? As when you're raising your series? A I know, you're gonna say it varies. But I mean, yeah, I guess how do you even begin knowing what your total should be?
Yes, I actually, I feel like I actually have stronger views on this than I did your prior question. So I'll give it a try. There we go. Right. Where I like to start on this is ask the entrepreneur, what do you want your company to look like 24 months from now. And 24 months is is not necessarily like locked in as a timescale. But I do think it's a fairly conventional one to Anker, on when you think about a fundraising period, meaning over the course of the next few years, how much money you really need to satisfy your strategic objectives of the company. And to what extent do you think that prepares the company to raise a series you know, a next round Series B Series C, wherever it is? at both evaluation and size of round that sort of is conducive to what we've done before, and also positions the company for kind of that next wave of success. And so we start there and kind of work backwards. Sometimes those are revenue milestones, sometimes that's the number of customers, sometimes it's product maturity, sometimes that's addressing sort of positioning in the market and trying to trying to kind of tell your story more clearly and build awareness around that story. But I think if you start there, and you start to solve backwards, what you what you eventually get to is, okay, so I'm going to need more people in each of these functions that are responsible for, for delivering on these objectives. And those functions are going to have budgets associated with them that aren't necessarily related to headcount. And what we start to, you start to see very clearly, then is that there is $1 amount associated with all those things that need to happen, relative to the capital at your disposal today, that I think at least starts as a good baseline for what that next round off will look like. And then of course, there's an argument to be had about whether one should leave six months to 12 months of buffer, should things take longer? Because they usually do. And so So my point is, I think starting from kind of what do you want your company to look like when you have to go and raise money again, that 18 months, 24 months or longer? is a great place to start? And I think it really does clarify this, this question of just how you should go about determining the amount of money you should go raise. Okay, I
am so glad that answer has a question has finally been asked, because it's something that I just haven't thought to think too much about. Would you be like, I guess, would it be a red flag if a founder came to you saying we want you to be a serious investor, but we don't know how much we want yet? Like, do you kind of expect founders when they enter the room to have $1 amount? Or does it look kind of unorganized if they don't,
I think showing up with $1 amount that is well reasoned, it conveys that you understand your business and its needs on a go forward basis, but also that you have a clear sense of the strategic objectives and funny. So I would encourage you all to come in having done some some work in that area and have a point of view. That being said, I think all of us as investors appreciate when founders show up with a collaborative approach to say, Hey, here's, here's what I think. But if we were to work together, this is something I'd certainly want your input on. So why not experience that together as a means of understanding what it might be like to work together? That's something we definitely appreciate. And I would encourage you all to just kind of walk into those conversations with an open mind, but have a point of view on something like that. It's just so core to the success of your company that your CEO or founder of Okay,
yeah, that's a much smoother way to phrase it, then I don't know how much to raise tell me what to do. I'm gonna ask you the inverse of the question. So Ryan gherardi asks, you know, where do you see most series A funds once the raise being spent across the Kp portfolio, kind of asking for a breakdown between product sales and marketing?
So taking a step back, we are a generalist, investor. So right. So we invest across enterprise software consumer, we invest in hard tech, we invest in financial services cybersecurity. So the reason I mentioned that and think it's worth taking a step back on is because I think it's hard to paint in broad strokes. When you think about a company in any one of those given spaces, and just how different it is from one it's not. But if I were to, if I were to do my best to answer that question in a way that I think might be useful for you, I think it's first important understand what kind of business you're building. So for example, if you're a software business and you have product market fit, what you typically see a series A is that the proceeds of that money will be used to to scale that. And again, some some of that act of scaling your product market fit comes down to advancing the product in directions that continue to open up your market opportunity and make it easier to sell and drive your acps up. But in other cases, it may be just you need to hire more salespeople, or you need to spend more money on demand. And you need to bring on more people to to scale that demand Gen strategy. So I think it's a question of if you have product market fit, I would think about what levers are at your disposal to scale that product market fit. And that's probably where I would encourage you to be placing your dollars that you raised. And if not, the question becomes like what's going to get me to product market fit. And I would think, again, about those levers at your disposal to bring you closer to that, which again, are typically team and RNG based for my experience, and I would see the lion's share of the dollars going towards that.
Okay, great. Yeah, continuing kind of like the spending theme. Elizabeth Cruz asked that, you know, should my startup be investing in a, an IP in the AI field? They mentioned that like some folks are saying that, in five years all AI will be open source like should I be spending money on IP at this moment in time?
Well, I'm not sure it's fair to answer that question specific to AI. Because I think what history has taught us is that no matter how unique your technology is, it will eventually be commoditized. There will be new approaches or the market will change rendering your technology less dominant and unique that it once was. And so my view on generating IP is I think you should more so be thinking about just what is the what is the product I need to put in front of your customers that provide the best in class solution to their problem, generate the necessary IP to deliver on that reuse other people's IP where it's legal and sensible to do so. But I wouldn't get so caught up in just investing in IP For the sake of it, because I don't think that necessarily translates to value creation in the business, what does is solving real problems for your customers and having a defensible position?
Okay, great. Do you guys invest in hardware By the way, I mentioned your generalist, but
because we do for those of you that are that are interested in talking to us about hardware investing, I would encourage you to seek out my partner when Shay who is our foremost expert in park tech and worked with companies like DJI and dexterity robotics, all of whom have really complex hardware supply chains, but are also doing things interesting at the top of their
suite. Okay, well, I mean, anonymous, so I don't know your name. But anonymous did ask if there's anything you can talk to about kind of a hardware startup, and specific concerns or specific things I should think about when it comes to a series, I don't have anything to kind of add on that point.
So this is by no means my or expertise. But I'll say a couple things. The first thing I'll say is one of the challenging things that we see about a hardware business, meaning one that does not necessarily have a software component associated with it, let alone a software component associated with it that operates on a subscription business model, is that customer acquisition costs relative to the lifetime value that you're able to extract from a given customer when there's buying something once is very challenging, right. So there are different ways to overcome that. And I think the extent to which you are able to overcome that challenge is the extent to which you have hardware business that at least my partners, and I would be really excited to invest in. And so I'll give you a couple examples of how that can look like one and most obviously, would be a business like what like I'm wearing one right now, what's special about what Well, what's special about them is that they've figured out a way to actually convince people like me to pay a subscription to work rather than just buying a murder once to store all this data and provide analysis on top of the data that makes that makes my life better, and helps me understand my personal health and fitness better. And so what that means is their business actually looks a lot more like a software business. Because they generate the subscription revenue on the on the software services that they that they give us, while also selling us a hardware component that ultimately is something that just again drive lifetime value. The other way to think about it too, is sometimes there's an aspect of having to replenish part of the hardware system. So an example of this would be like HP printers, right? The really the great business about HP printers is the fact that they get to sell you the ink, right, and people have to keep buying because they print more out, you could say the same about a Kp portfolio company that is now on the public markets with desktop metal. Again, they sell renewable renewable cartridges that you put into these, these metal printing systems to actually continue to produce the products. And so the question I'd be asking if I was an entrepreneur building in the hardware space is, to what extent can i associated subscription revenue stream with my business because it will make it much more durable and defensible? Now, there are of course, some exceptions to that. But I think the question that a lot of investors are gonna have is one, like what's durable about your position in the market? What's gonna keep keep customers from continuing to want to buy your product? And then ultimately, how do you start to drive up your margin profile over time, because part of our margins are generally low, and the supply chain behind them is complex. And so our view is that it's, it's really hard to sustain a business over time there unless there's some kind of unique position in the market or a subscription component associated with it. And it's an exception to this of just a pure Harvard Business has gone on to do really well as a company with DJI they built a dominant consumer brand. And they have a pair that with best in class technology. And that's given them a lot of runway as a business to continue scaling on the consumer side with with no subscription revenue models.
It's really refreshing to hear about hardware in a way that isn't like hardware is dead, because I feel like that's just been the dominant for maybe at least in my echo chamber at this moment. So it's definitely exciting to know that there are some investors that are interested in it. And I think I want to spend kind of like the last few minutes here on how to figure out like what investors you should be finding and reaching out to and the best ways son meet asked, you know, the best way to pitch Kp partners on consumer internet on other sectors, like, Is there any way that different from kind of the normal that you think Kp prefers to be pitched?
Well, I mean, I think we would encourage anyone to just reach out to us if they have an idea that they think would be of interest to us. And you can do that by email, you can do that by a warm introductions, believe and respond to LinkedIn messages. But I would ask you to avoid that unless it's your only option, because they're, they're quite noisy. So I would just encourage you to get in touch. And I think you'll be surprised by how often you'll get a response from us. And particularly, the places where we don't respond are not because we didn't see the message, but simply because we just didn't see it to be a fit. And we wanted to make sure we were also mindful of your time, too. But, so any of these ways, but I think the number one way, especially if you don't know an existing partner to venture firm would be to get a warm introduction. And I think if you don't have an ability to get a warm introduction, I would encourage you just to send a powerful cold email to the person who you think the opportunity is going to resonate most with and we get these all the time and we respond to most of them and the ones that we are most To respond to are the ones that convey that the person has actually thought about why why you as the investor could be the right person for their business. And in his major case that their business is actually one that could be a fit for us in theory that, yeah, how to find the right person? Yeah. Did you want to talk about that?
No, no, please continue.
Yeah, I was gonna say I think there's, there's a few different parameters to think about there. Some are tactical, some are stylistic, and some are more, I would say, strategic nature. So the first is, of course, like, what is the what is the partner at the event who are actually focused on so Are they an enterprise software investor with a consumer internet investor, there's some pretty easy ways to figure that out. One is just by sort of how they how they represent themselves in the public sphere. Another is probably best indicators, the types of companies that they've invested in to date. And another is just simply by looking at the areas in which they seem to be most present and active from a thought leadership perspective. So think a lot about that, and just narrow it down to a list of people who are genuinely likely to invest in your business on the basis of their interests on the basis of their prior track record. So that's the first thing. The second thing and this this gets a little bit more tactical is most series a venture investors make very few investments each year, somewhere between one and three, what you typically see. And so what I would encourage you to do is let's say you're you're planning to go and raise a financing round in November of this year. And if you notice that there's an investor who's already made two, if not three series investments in a year, I can assure you that it's less likely to be the case that they're going to be ready to make another investment. And that's simply just then being guarded with their time, right? Like, it actually does require a lot of time to take on a new board seat partner with a new entrepreneur and provide them with a high level of service. Yeah, well, hiring standpoint from helping them kind of engage with the right people in the market is customer standpoint, there's a lot there. And I think it's, it's why you see theories and doctors be a bit more selective in terms of their investment case. And so that would be that would be another thing to think about how they made investments this year, and what doesn't look like. But assuming assuming they haven't already made their two or three investments that I think you can then then kind of proceed to say, okay, so like, you know, what do I know about this person? What do people say about them? What entrepreneurs do they work with? And are those entrepreneurs people that I would be excited to associate with? And I think if you start to get to kind of Yes, yes, yes. on all these things that could be very, like kidney very well likely that this is somebody who you should be pitching. And so I'm at that point, I would come back to kind of how you get in touch with us. And I think the answer to how you do so with other venture firms is relatively similar. I would think about getting a warm introduction. And if not, because I know that not everyone has the ability to do that. Send us a cold email. And I think you'll be surprised by the rate of response that you get on those types of cold email.
Yeah, I mean, I also It sounds like you're kind of recommending to to, like prevent, before you even pitch, right? Instead of kind of do the 300 cold emails kind of be really picky.
I think the fewer people that you actually reach out to, the easier it is to really assess bit and be really thoughtful with how you do the outreach. And so it's very obvious to me, at least when when I can tell someone who's sending over 300 different people versus just sending it to me, because they're very specific about why me and why they think I would be a good fit to help them build their business. And that's appreciate.
Yeah. And I want to ask one more thing about warm intros, you know, as since you guys are the best across kind of all stages, do you see warm intros playing a bigger role at certain stages than others? I'm curious if like it matters more, and see, then series A or matters more in series A, then C. And
I think the earlier stage, you go, the more that kind of social proof is valuable as signal. And again, like one of our major objectives is to ensure that we're seeing entrepreneurs from everywhere in the world, all walks of life and outside of our concentric circles of our network. And so we have to be very careful about anchoring through motion warm intros, because otherwise, we're only going to invest in people that are like us that we know. And that's not at all what we want, or do we think it's in our firm's best interest from a return standpoint? Yeah. And so there are a number of ways to get around this. But I do think I do think the warm intros matter at the earlier stages, particularly when the founders themselves are are embarking on this journey for the first time and may come from the less likely background that would suggest they have a lot of the obvious indicators for success before product market fit. Okay. But again, like if you don't have the ability to get a warm intro, that is completely fine. And we would still really encourage you to get in touch with us and we want to talk to you. And again, I think these thoughtful emails as to why why you and thinking about some of these questions that we've talked about during this during this, this discussion, can can really illuminate that and help us see that plus to asking for some of your time to come and pick up and tell tell us about your business is worth doing. Yeah,
I mean, even on that note, we only have a few minutes left. So I'll squeeze in, I think one and a half more questions. First mine because I'm selfish. The pandemic Do you think pitching over zoom has changed kind of like what you're looking for and that initial pitch like do you are you no longer pitch deck lovers or have you never been pitched deck offers? Or as I think that kind of the infrastructure and kind of paperwork side changed.
My view on pitch decks hasn't changed, I tend to think that there are a ideal way to organize and preserve structure around a conversation. But as I often tell folks, I'll try to keep it interesting and ask a lot of questions that keep us off topic, but I do think they're helpful. So I would encourage all of you to show up with a pitch deck when, especially when raising a series a load with regards to the pandemic, and zoom, I actually believe that first meetings over zoom are here to stay, I think it's far more efficient, I think the objective of that meeting should be to set it on both sides or potential fit. And for the investor, at least, to want to understand the narrative of the company. And what's reinforcing that the narrative is actually translating to reality. And I think once you've done that, what I've learned is that it is critically important for both sides to have a chance to spend time in person if possible, right. And when I say if possible, there obviously has been a number of cases where we've decided and been comfortable with making an investment in extending a term sheet to a company where we haven't met them in person. But when that opportunity is available to us, we personally believe that that taking advantage of it makes a ton of sense for both sides, there's just so many indicators that get lost in translation of resume that I think really do speak to the bandwidth of communication that you're able to have with someone. And as an investor, what I'm asking myself is, is someone that I want to work with for the next seven to 10 years is is somebody that I want to think with problem solve with, do I think I can help this person. And I think the fidelity that you get from being able to have some of those final interactions in person really helped me personally build confidence in that. And so I seize that opportunity when it's available. But again, our job is to find and work with the best. And sometimes we find and we find the best and they're not available, there's no especially admits the circumstances. So it might be in Europe or even New York and you know, hasn't hasn't necessarily found a safe way to get to the Bay Area. nor have we were very happy to continue that conversation over zoom. But I think it requires extra time and extra attention to ensure that that fidelity of communication and
it sounds like you're long San Francisco in some way that and
I'm actually long off career opportunity being dispersed everywhere. And I think that's a great thing for society. And I also think it's a great thing for the for the venture industry. So I do think the Bay Area will continue to be relevant, but I'm excited about these entrepreneurial centers that are spawning both on the internet but also in places less likely barrier to have an original.
Amazing, thank you Bucky so much for joining us. Thank you early stage listeners. We'll get the recap live tomorrow, but other than that, have a great rest of your day. Take care, everyone.
